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The Association shall not cover under a P&I entry liabilities, losses, costs or expenses incurred by the Member in respect of any of the following:
a personnel (other than marine crew) on board the Ship (being an accommodation vessel) employed otherwise than by the Member unless
i. such Ship is moored or anchored more than 500 meters from any oil or gas production or exploration facility; and
ii. there has been a contractual allocation of risks as between the Member and the employer of the personnel which has been approved by the Association;
b hotel and restaurant guests and other visitors and catering crew of the Ship when the Ship is moored (otherwise than on a temporary basis) and is open to the public as a hotel restaurant, bar or other place of entertainment.
Some ships are built and intended for use not as cargo or passenger-carrying vessels, but as places for the accommodation of personnel that are engaged in activities on or under the sea, e.g. in oil or gas exploration fields. Other ships that were initially built for cargo or passenger-carrying purposes, may subsequently be used as places of accommodation, or may be permanently moored and used as places of entertainment. In both cases, whilst the ship may still be subject to marine risks, it may also be subject to many non-marine risks as a result of such usage.
The purpose and aim of the Association is to provide cover on a mutual basis for marine risks that result from the operation of a Ship.1 Consequently, it is not considered to be consistent with that aim and purpose for the Association to provide P&I cover for non-marine risks that result from the use of Ships for other non-marine purposes. Therefore, Rule 56 excludes certain risks that the Association considers to be essentially non-marine in character and, therefore, outside the scope of P&I cover.
(A) …The Association shall not cover under a P&I entry liabilities.....incurred by the Member in respect of any of the following… (Rule 56)
Rule 56 does not exclude cover completely when Ships that have been entered in the Association are used for the non-marine purposes to which reference is made above. Cover is excluded only for those liabilities, costs or expenses that have been incurred by the Member as a result of such usage and cover remains available for liabilities etc. that do not result from such usage.
(B) …personnel (other than marine crew) on board the Ship (being an accommodation vessel) employed otherwise than by the Member… (Rule 56.a)
The predominant aim of Rule 56 (a) is to exclude liabilities etc., that are incurred in relation to non-marine personnel, meaning in practice personnel other than marine crew as defined in Rule 1, when the Ship is used as an accommodation vessel.
The term ‘accommodation vessel’ includes, inter alia, an offshore multi-purpose support vessel that provides accommodation as well as other services to an oil field, or a passenger vessel that is employed to provide accommodation for people working ashore, or a ‘flotel’ that is employed as a prison ship, but not a passenger vessel that is engaged in its normal trade of carrying passengers.
Rule 56 does not affect the cover that is available under Rules 27 and 292 for liabilities, losses, costs and expenses that are incurred by the Member in relation to personnel that are employed by him, whether as members of the Crew or otherwise, or any persons that are on board for reasons other than employment, e.g. passengers or family members of the Crew.
(C) …unless (i) such Ship is moored or anchored more than 500 meters from any oil or gas production or exploration facility; and (ii) there has been a contractual allocation of risks as between the Member and the employer of the personnel which has been approved by the Association; (Rule 56 (a) (i) and (ii))
The exclusion in Rule 56 (a) shall not apply if certain specific requirements designed to reduce risk to the Association’s mutual funds are met. In practice this means that cover is available for liabilities etc. in respect of non-marine personnel employed otherwise than by the Member, such as for example catering staff employed by a sub-contractor, if the requirements set out in provisos (i) and (ii) to Rule 56 (a) are met. These requirements are as follows:
Firstly, the Ship (being an accommodation vessel) must be moored or anchored more than 500 metres from any oil or gas production facility and not merely more than 500 metres from the particular oil or gas facility that the Ship is serving ar any particular time
Secondly, cover is available only if the employer of such non-marine personnel and the Member have concluded an agreement the terms of which have been approved by the Association3 that allocates the relevant risks inter se,.
Cover is available only if both requirements have been satisfied.
(D) …hotel and restaurant guests and other visitors and catering crew of the Ship when the Ship is moored (otherwise than on a temporary basis) and is open to the public as a hotel restaurant, bar or other place of entertainment. (Rule 56.b)
A Ship may be permanently moored and used as a hotel, restaurant or other place of entertainment that is open to the public, e.g. as a night club or as a nautical museum or excursion site. Such a Ship will normally be moored alongside the shore in order to allow easy access for guests and visitors, but the Ship may also be deemed to be ‘moored’ when it is at anchor and members of the public are transported to it by launch or other craft.
Rule 56.b excludes cover for liabilities etc., that are incurred by the Member in relation to any guest, visitor or catering staff, whether or not employed by the Member, when the Ship is permanently moored. However, cover is not excluded for liabilities etc., that are incurred by the Member in relation to Crew members.4 Therefore, for example, if a fire were to break out on board a Ship that is permanently moored, cover is available for liabilities etc., that are incurred by the Member in relation to Crew members that are employed by the Member to maintain the Ship’s engines, but not in relation to catering staff that are employed by the Member, nor in relation to patrons and other guests that are visiting the Ship for recreational purposes.
However, cover is not excluded when the Ship is merely temporarily moored for such purposes.5 The question of what is, or is not, temporary is one of fact depending on the particular circumstances. However, factors such as the duration of the mooring time and the intention of the Member are relevant guidelines. For example, the use of cruise ships as accommodation units for a month or so during the 2004 Athens and 2014 London Olympic Games was considered to be temporary usage since the intention was to reuse the ships for cruising once the Olympic Games were over.
The term ‘open to the public’ is interpreted broadly to encompass any situation where access to the Ship is available to people that are not on board by virtue of their employment, but, rather, for the purpose of using the hotel restaurant, bar or other entertainment facilities. A Ship is not considered to be ‘open to the public’ if visitors are entitled to come on board only by special permission. For example, should a police authority charter a Ship for a prolonged period of time for use as a moored accommodation and special training facility and deny access to the Ship to any other persons, such a Ship would not be considered to be a Ship that was open to the public.
1 See the Guidance to Rule 2.4
2 See the Guidance to these Rules.
3 See the Guidance to Rule 55.
4 Cover would normally be available in respect of Crew members under Rule 2
5 Cover would normally be available in such circumstances under Rule 29.